WASHINGTON, June 6 (Reuters) - The United States, Saudi
Arabia and dozens of other countries agreed on Wednesday that
further economic sanctions were needed to stop President Bashar
al-Assad from repressing Syrian people and urged nations to
adopt an arms embargo, travel bans and tougher financial
penalties against his government.

"A continued concerted multinational approach is necessary
to further deprive the Assad regime of the financial resources
needed to sustain its campaign of violent repression," the
Friends of Syria working group said at the end of a one-day
meeting in Washington that was hosted by the U.S. Treasury.

More than 55 mostly Western and Arab countries opposed to
Assad's rule said that at a minimum an asset freeze on senior
Syrian government officials as well as restricted business with
Syria's central bank and leading commercial bank was needed to
isolate his regime from the global financial system.

The group also expressed support for taking steps toward a
United Nations Security Council "Chapter 7" resolution - a
measure that could authorize the use of force.

A peace plan brokered by international envoy Kofi Annan has
so far failed with Assad's government refusing to honor a
comprehensive ceasefire. Troops loyal to Assad are accused by
opponents of a new massacre of at least 78 people hours before a
divided United Nations Security Council convenes to review the
crisis.

"Absent meaningful compliance by the regime with the Annan
plan, that is the direction in which we are soon headed," U.S.
Treasury Secretary Timothy Geithner told delegates at the
beginning of the meeting.

Later, a U.S. Treasury official said there were a couple of
major components to their strategy, which included stripping
away Assad's supporters, putting pressure on the Syrian business
community and starving Assad's government of resources needed to
survive.

The official did not have an estimate for the level of
Assad's reserves or for how long he could survive. But he said
it was clear the Syrian government was under financial strain
and pointed to the significant deterioration in Syria's currency
and the European oil embargo that accounted for 90 percent of
the country's export market.

"It is clear that they are depleting their reserves," the
Treasury official said.

The United States has blocked Syria's central bank and top
Syrian government officials from U.S. markets. Qatar, which
co-chaired the working group with Turkey, has imposed similar
penalties on Syria's financial institutions. Turkey has expanded
its list of blacklisted government officials and the European
Union has banned imports of Syrian oil and imposed sanctions on
Syria's main mobile phone operator.

Earlier, Geithner acknowledged that the sanctions would not
be enough to stop the violence or bring about political change
but said they played an important role.

"Strong sanctions make clear to the Syrian business
community and other supporters of the regime that their future
is bleak so long as the Assad regime remains in power," he said.

The working group, which included representatives from the
European Union, South Korea and Japan, discussed how the
government has tried to evade sanctions and how they could
further coordinate their penalties. Foreign ministers of the
Friends of Syria, including U.S. Secretary of State Hillary
Clinton, are currently meeting in Istanbul for a conference on
Syria.